Thursday, July 28, 2011

Bajaj Allianz declares Bonus Rates for FY 2010-11


Pune, 27 July 2011: Bajaj Allianz Life Insurance has declared the bonus rates for its participating policies. The bonuses are calculated by applying the bonus rates on the sum assured plus already attached bonuses of the policy and in most cases are payable on maturity or surrender of the policy or on death of the life assured.
The compound reversionary bonus rates (CRB) for FY 10-11 for some of the popular products are given below.

Product Name
Compound Reversionary Bonus Rate*
Terminal Bonus Rate**
Bajaj Allianz Super Saver
1.25%
0.5%
Bajaj Allianz ChildGain
2.50%
1.5%
Bajaj Allianz InvestGain
2.25%
0.5%
Bajaj Allianz Super CashGain Insurance Plan
2.25%
0.5%
Bajaj Allianz CashRich Insurance Plan
3.00%
0.5%

* Compound Reversionary Bonus (CRB)
is calculated as a percentage of Sum Assured plus all previously accrued bonuses.

** Terminal Bonus is calculated on the sum assured and for each completed year of the policy subject to at least 5 years and is payable on maturity or death during the FY 2011-12.

Example of Compound Reversionary Bonus Rate vs Simple Reversionary Bonus Rate
Let’s take the example of Bajaj Allianz Cash Rich Insurance Plan. For this plan, the declared Compound Reversionary Bonus (CRB) is 3.00% in FY 10-11, as mentioned above. If we take a policy of sum assured of Rs.10,00,000 and premium paying term of 30 years and assuming the company will declare same CRB rate every year, the total accrued CRB will be Rs. 14,27,262 at the end of 30 years. The bonus rate if declared as Simple Reversionary Bonus, then the equivalent rate will be Rs. 4.758% or    Rs. 47.58 per 1000 sum assured at the end of the 30 years.
Other Notes
·         A participating policy (often referred as par policy) or with-profits policy is an insurance contract that participates in the surplus generated in the participating fund. The insurance company aims to distribute part of its surplus to the with-profits policyholders in the form of a bonus attached to their policy.
·         How insurer declares bonus - The bonus rate is decided after considering a variety of factors such as the return on the underlying assets, the level of bonuses declared in previous years and other actuarial assumptions (especially future liabilities and anticipated investment returns), as well as marketing considerations.

About Bajaj Allianz
Bajaj Allianz is one of the leading Private Sector life & general insurance companies in India. Bajaj Allianz is a union between Allianz SE, the world’s leading insurer and Bajaj Finserv Limited (financial arm of Bajaj Group). Allianz SE is a leading insurance conglomerate globally and one of the largest asset managers in the world, managing assets worth over a Trillion Euros (over Rs. 55, 00,000 crores). At Bajaj Allianz, customer delight is our guiding principle. Ensuring world class solutions by offering you customized products with transparent benefits supported by the best technology is our business philosophy. Bajaj Allianz began its operations in 2001 and today has a pan-India presence with over with offices and presence in over 1100+ towns in the country. The companies have been constantly expanding its operations to be close to their customers.

Bajaj Allianz Life Insurance has developed insurance solutions that cater to every segment and age-income profiles. Currently Bajaj Allianz has a strong product portfolio of over 30 flexible products and caters to all kinds of customer needs from ULIPs to Child plans, from group insurance to health insurance. 

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